Google’s monopoly on online search engines has finally gone to trial in the United States, three years after the US government filed a lawsuit alleging violations of antitrust law. At issue is the nature of the internet search market — but from a broad public interest perspective, this is a case about power.
Right now, big tech sets out the rules of the digital marketplace; online, it plays both judge and jury. When it does go to court, tech giants usually win: they have emerged victorious in every major battle that has threatened to limit their power.
When these giants do lose, they pay fines that are a mere pittance of their global revenues, demonstrating that it pays to fight antitrust cases, take meagre penalties and continue current business practices unabated.
No one can deny that Google Search is an incredibly useful tool that gives informative results seemingly for free. Despite this, it actually harms the consumer — for a number of reasons.
First, as the default search engine for the internet, Google can cement its market power and that of its corporate partners, reducing competition. The lawsuit currently at trial highlights Google’s ability to make special deals that allow for this, to the benefit of its big tech partners. For example, Google is the default search engine for Safari because it directly pays Apple for this privilege, boosting the profiles and profits of both companies.
Second, Google’s power has significant implications for user privacy. With each search, a user gives away personal data — and it can be very personal — about likes, dislikes and more. This data is very valuable in Google’s main line of business: advertising. With inadequate laws and regulations to protect personal data, big tech can essentially do what it wants with this information. Search is therefore not free; it comes at the cost of a user’s privacy.
Third, with astronomical advertising revenue, Google can leverage its power to move into adjacent markets. Sure, its profits can be used to improve its search engine and develop new services. But these profits can also be used to take out nascent competitors, move into adjacent markets with the help of proprietary information, create more cozy tech deals and consolidate power through lobbying. Indeed, in the past year, Google has spent about $10 million on lobbying in the United States alone; over the past decade, the figure amounts to tens of millions of dollars.
Why should Canadians care about the present court battle between Google and the US government? As consultations on future amendments to the Competition Act are carried out, we need to ensure that Canada’s Competition Bureau has the power to act effectively with the changes in the competition landscape arising from digital technologies.
Although recently announced federal changes to enhance competition are very welcome, this trial shows exactly how big tech can control and influence critical areas related to our daily lives no matter where we live. At home, we have witnessed this exercise of control in big tech’s attempt to domineer Canadian newsfeeds in reaction to the passing of Bill C-18, the Online News Act.
Canadian regulatory structures therefore need to adapt. We are off to a good start, having already recognized that regulation of big tech is not the responsibility of one sole agency with the establishment of the Digital Regulators Forum in June. The forum aims to strengthen information sharing and collaboration among the Competition Bureau, the Canadian Radio-television and Telecommunications Commission and the Office of the Privacy Commissioner of Canada that relate to digital markets and platforms.
However, the establishment of the forum is also a bare minimum. Other countries, such as Australia and the United Kingdom, have gone further by including financial and online harms regulators in their own co-operative forums for digital regulation.
Big tech has created substantial regulatory issues. Only with a better coordinated response, nationally and internationally, can we ensure that the broader policy issues are addressed so that consumers can truly benefit.
This article first appeared in the National Post.